diff --git a/CHANGELOG.rst b/CHANGELOG.rst
index 5c80392bb..c9e36aa0c 100644
--- a/CHANGELOG.rst
+++ b/CHANGELOG.rst
@@ -112,6 +112,7 @@ Interactive improvements
 -  ``diff`` will now colourise output, if supported (#7308).
 -  The command-not-found handling has been simplified. When it can't find a command, fish now just executes a function called ``fish_command_not_found`` instead of firing an event, making it easier to replace and reason about. Shims for backwards-compatibility have been added (#7293).
 -  Control-C no longer occasionally prints an "unknown command" error (#7145).
+-  History search is now case-insensitive unless the search string contains an uppercase character (#7273).
 
 
 New or improved bindings
diff --git a/doc_src/index.rst b/doc_src/index.rst
index 0a51559fe..317f57190 100644
--- a/doc_src/index.rst
+++ b/doc_src/index.rst
@@ -1718,7 +1718,7 @@ After a command has been executed, it is remembered in the history list. Any dup
 
 By pressing :kbd:`Alt`\ +\ :kbd:`↑` and :kbd:`Alt`\ +\ :kbd:`↓`, a history search is also performed, but instead of searching for a complete commandline, each commandline is broken into separate elements just like it would be before execution, and the history is searched for an element matching that under the cursor.
 
-History searches can be aborted by pressing the escape key.
+History searches are case-insensitive unless the search string contains an uppercase character, and they can be aborted by pressing the escape key.
 
 Prefixing the commandline with a space will prevent the entire line from being stored in the history.
 
diff --git a/src/reader.cpp b/src/reader.cpp
index ed7903337..d6c7d9b9c 100644
--- a/src/reader.cpp
+++ b/src/reader.cpp
@@ -398,11 +398,15 @@ class reader_history_search_t {
         matches_ = {text};
         match_index_ = 0;
         mode_ = mode;
+        history_search_flags_t flags = history_search_no_dedup;
+        // Make the search case-insensitive unless we have an uppercase character.
+        wcstring low = wcstolower(text);
+        if (low == text) flags |= history_search_ignore_case;
         // We can skip dedup in history_search_t because we do it ourselves in skips_.
         search_ = history_search_t(
             *hist, text,
             by_prefix() ? history_search_type_t::prefix : history_search_type_t::contains,
-            history_search_no_dedup);
+            flags);
     }
 
     /// Reset to inactive search.
@@ -935,7 +939,7 @@ void reader_data_t::paint_layout(const wchar_t *reason) {
     if (!conf.in_silent_mode && !data.history_search_text.empty()) {
         const wcstring &needle = data.history_search_text;
         const wcstring &haystack = cmd_line->text();
-        size_t match_pos = haystack.find(needle);
+        size_t match_pos = ifind(haystack,needle);
         if (match_pos != wcstring::npos) {
             for (size_t i = 0; i < needle.size(); i++) {
                 colors.at(match_pos + i).background = highlight_role_t::search_match;
diff --git a/tests/pexpects/history.py b/tests/pexpects/history.py
index 551e0c226..c1aecb7be 100644
--- a/tests/pexpects/history.py
+++ b/tests/pexpects/history.py
@@ -132,3 +132,13 @@ expect_re("count again 1\r\n")
 # Verify that the $history var has the expected content.
 sendline("echo history2=$history\[2\]")
 expect_re("history2=echo count AGAIN .*\r\n")
+
+# Verify that history search is case-insensitive by default
+sendline("echo term")
+expect_str("term")
+sendline("echo TERM")
+expect_str("TERM")
+sendline("echo banana")
+expect_str("banana")
+send("ter\x1b[A")  # up-arrow
+expect_re("echo TERM")